Monday, October 19, 2020

Bitcoin Bar 'Room 77' Shuts Down

By Jeffrey Gogo
Monday, October 19, 2020

Room 77, the German bar and restaurant that claims to be the first retail outfit in the world to accept bitcoin payments, has shut down. Cypherpunk Holdings chief economist Jon Matonis broke the news on Twitter. Bar owner Jorg Platzer later confirmed it on Reddit.

“Room 77 is closing for good,” Platzer revealed in a rather futuristic, celebratory post on Oct. 18. “We think our mission is accomplished and it is time to go back to our home planet. Thanks for all the fish and the generous tips!”

No official reason was given for the closure of the Berlin-based joint. But there’s suspicion this may have been related to the coronavirus pandemic. Lockdown restrictions linked to Covid-19 have hit the global hospitality industry hard.

In Berlin, strict restrictions on the sale of alcohol remain in place, with bar operators banned from selling the product from 11 p.m. to 6 a.m. The measures have badly affected profits.

Located in Kreuzberg, Berlin, Room 77 began accepting bitcoin (BTC) as a means of payment in 2011, becoming the first bar, and most likely the first private retail outlet, in the world to do so. Since then, the drinking spot has developed into something of a pilgrimage site for bitcoiners, who patronize the place for its BTC payments and more.

“Before we did that (accept BTC), all media coverage about bitcoin was about hackers stealing credit card details and selling them on the black markets,” Platzer said in a 2018 interview, highlighting how the establishment had changed media perceptions and coverage around the top cryptocurrency.

In the crypto community, people responded to Room 77’s closure with fond memories of the past.

“End of an Era: Room 77 in Berlin closes doors permanently!” tweeted Jon Matonis, the Cypherpunk Holdings chief economist. “Blame it on Covid or blame it on gentrification. Either way, this Kreuzberg landmark has served as a Bitcoin watering hole for over 10 years, with thousands making the obligatory pilgrimage. Thx for the memories, Joerg!”

Redditor @etrnetm said: “Thanks for providing the unofficial embassy of Bitcoin in Berlin to us earthlings. We shall meet again.”

In his Reddit post, Platzer concluded:
It is clear by now that nobody will stop bitcoin anymore. Sound money on a global scale will soon make it unfeasable to wage wars and it will create economic equality amongst mankind. We estimate it will take you less than another century to rise and join the intergalactic community.

Wednesday, June 10, 2020

Human Rights Foundation Funds Bitcoin Privacy Tools Despite ‘Coin Mixing’ Legal Stigma

By Leigh Cuen
Wednesday, June 10, 2020

On one hand, the bitcoin industry has matured to include traditional brokerages and institutional traders. On the other, bitcoin privacy tech is still shrouded in a legal gray zone.

Critics like Reckless VR founder Udi Wertheimer and Jon Matonis of Cypherpunk Holdings, the latter of which invested in both the privacy-oriented Samourai Wallet and Wasabi-maker zkSNACKs, say blockchain analytics firms are overestimating the amount of illicit transactions when they flag mixed bitcoin.

“Exchanges, banks and regulators are being sold a false narrative if they believe that this [analytics] technology provides reliable, or more importantly, actionable results,” Matonis said. “It is purely a dangerous game of probabilities and false positives, disingenuously overstated to peddle more forensic services.”

HRF’s Gladstein recently took Elliptic, another blockchain analytics firm, to task for its “surveillance” work. “The tools you’re building regardless of your intentions will be used for policing bitcoin,” Gladstein said during a panel with Elliptic’s Tom Robinson at an event this month. “At the end of the day what you’re doing is warrantless surveillance against people in other countries.”

For his part, Matonis’s investment thesis revolves around the belief the legal community will adopt compliance norms that don’t restrict or criminalize privacy-tech like mixers.

“The concern around mixing technology, or coin hygiene, stems from the flawed thinking that cryptocurrency transactions are identical to bank transfers using fiat currency,” Matonis said. “This is a grand societal battle that must be won by privacy advocates, not because it is a cute feature or a principled position, but because it is an existential economic necessity. A peer-to-peer value transfer system fails without underlying coin privacy at its core, because the entire system would lack fungibility if all coins were not treated equally the way paper cash is today.”

This is why some bitcoiners continue to work on privacy tech, regardless of exchange policies and other hurdles.

Continued growth

Meanwhile, CoinJoin usage continues to increase, with roughly 13,500 new Wasabi Wallet downloads this year.

So far in June, more than 10,000 fresh bitcoin were used in Wasabi CoinJoin transactions for the first time, the highest record since the all-time peak in August 2019 according to the Wasabi team.

Overall, usage has more than tripled since May 2019, when roughly 9,764 total bitcoin were used in Wasabi’s CoinJoin transactions, compared to 35,697 total bitcoin used in May 2020, they said.

And that’s not even to mention the few thousand bitcoin sent using other CoinJoin tools since the coronavirus began, including Samourai Wallet and JoinMarket. Generally speaking, usage appears to be up across the sector.

Matonis said as long as companies and public individuals focus on non-custodial, open source software, he believes privacy-tech projects will actually bear less compliance costs over time as the tools become normalized. For example, mixing protocols could become a “standard default feature” in bitcoin wallets.

“Both the bitcoin industry and law enforcement need to resist falling for the myth of blockchain forensics as perpetrated by the blockchain surveillance firms,” Matonis said of companies that routinely flag mixed coins as suspicious.

“Law enforcement methods will undoubtedly have to evolve beyond simply using money as an identity tracking device or simply relying on metadata through non-targeted driftnet surveillance,” he added. “This means employing real and sometimes cumbersome police work that doesn’t violate the rights of any individuals.”

Tuesday, March 24, 2020

Blockchain Rock Interview with Jon Matonis

Blockchain Rock
Tuesday, March 24, 2020

We are back, and we open this new season with an outstanding guest: Jon Matonis! A legend of the crypto-world (and you’ll know why by the end of this episode): he’s the Chief Economist at Cypherpunk Holdings, a Forbes and Coindesk recurrent author, and the Founding and Executive Director of the Bitcoin Foundation.

This episode explores Jon’s story as well as the story of digital cryptography: starting from encrypted email, to Verisign, Digicash, eGold, and the work of the Bitcoin Foundation. We also discuss themes such as financial privacy and its importance to economic and political freedom, the Crypto Arms Race, the end game for Bitcoin, and the three primary functions of money.

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